Chicago, IL – January 31, 2025 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Impinj PI, Synaptics SYNA, Lumentum Holdings LITE and FormFactor FORM.
Here are highlights from Thursday’s Analyst Blog:
The global semiconductor industry is experiencing massive growth fueled by the demand for chips across high-performance computing, artificial intelligence, automotive and electric vehicle market, consumer electronics, networking, the Internet of Things, cloud computing and data centers.
In the Jan. 7, 2025 report, the Semiconductor Industry Association reported that global semiconductor sales touched $57.8 billion in November 2024 with a year-over-year increase of 20.7%. The semiconductor chip sales increased 55% in the United States. Despite the semiconductor chip export ban by the United States on China, the semiconductor chip sales in China were up 12.1%, followed by 10% in Asia Pacific and 7.4% in Japan.
The recent advancements in generative AI, marked by the launch of ChatGPT o1-preview, DeepSeek R1, Alibaba's Qwen 2.5 and META's Llama-3.1-405B models have the potential to ignite a competitive GenAI race. This surge in competition is likely to drive demand for the semiconductor chips that power these advanced models.
Buoyed by these factors, the overall semiconductor market is expected to continue to grow as suggested by the Fortune Business Insights report, projecting a robust CAGR of 14.9% from 2024 to 2032. The market is anticipated to reach $2,062.6 billion by 2032, creating fertile ground for semiconductor companies.
The strong fundamentals of the industry are expected to boost the profit of semiconductor companies this earnings season. Therefore, investors should consider making investments in semiconductor stocks ahead of their upcoming quarterly results. Buying stocks before earnings can be a strategic move for investors looking to capitalize on potential upside surprises. Companies that report better-than-expected earnings often see sharp price rallies as analysts revise forecasts and institutional investors increase positions.
Here, we have picked four semiconductor stocks — Impinj, Synaptics, Lumentum Holdings and FormFactor — which are scheduled to report their quarterly results in the next couple of weeks. All these stocks have a favorable Zacks Rank and are projected to report strong year-over-year earnings growth in the to-be-reported quarter.
Impinj is scheduled to report fourth-quarter 2024 results on Feb. 5. The Zacks Consensus Estimate for fourth-quarter earnings per share (EPS) has remained unchanged at 47 cents, indicating a year-over-year increase of 422.2%. The stock has surpassed the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average surprise being 173.2%.
Impinj's fundamentals point to a promising future. The company's specialized RFID technology, RAIN, offers wireless item-to-cloud connectivity, addressing critical needs across industries, such as retail, logistics, healthcare, and food and beverage. In recent years, PI has expanded its offering by integrating cloud and software capabilities. These innovations enhance its RAIN technology, allowing customers to leverage data analytics, real-time tracking and software integration.
Emerging use cases also highlight Impinj's relevance. From apparel and food tagging to tracking perishable goods, its solutions are increasingly indispensable. The company's focus on high-growth areas, such as quick-service restaurants and grocery tagging pilots, underscores its ability to tap into new markets with substantial potential.
The Zacks Consensus Estimate for Impinj's 2025 revenues and EPS indicates strong year-over-year growth of 19.5% and 34.4%, respectively. PI sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today's Zacks #1 Rank stocks here.
Synaptics is scheduled to report second-quarter fiscal 2025 results on Feb. 6. The consensus mark for second-quarter EPS has remained unchanged at 86 cents, indicating year-over-year growth of 50.9%. It has surpassed the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average surprise being 13.6%.
Synaptics is a leading innovator in human interface technologies, specializing in touch, display and biometric solutions for consumer and industrial applications. The company is transitioning from its legacy mobile business to high-growth markets, such as AI-powered edge computing, automotive touch interfaces and IoT connectivity, positioning itself for long-term expansion.
Revenue diversification is a key strength, with IoT now contributing more than 50% of total sales, reducing reliance on cyclical smartphone demand. Additionally, margin expansion through operational efficiency and a fabless manufacturing model enhances profitability.
The Zacks Consensus Estimate for Synaptics' fiscal 2025 revenues and EPS indicates year-over-year growth of 9.5% and 45.3%, respectively. SYNA carries a Zacks Rank #2 (Buy) at present.
Lumentum Holdings is set to report second-quarter fiscal 2025 results on Feb. 6. The consensus mark for second-quarter EPS has been revised upward by a penny to 37 cents, indicating year-over-year growth of 15.6%. It has surpassed the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average surprise being 38.3%.
LITE is a key player in optical networking and laser technologies, serving the telecommunications, data center and 3D sensing markets. The company benefits from rising demand for high-speed optical networking, driven by AI-driven data center expansions and cloud computing growth.
Lumentum Holdings' sustained focus on enhancing its portfolio has strengthened its market position in next-gen optical components, enhancing its ability to supply hyperscale cloud providers and telecom giants.
The Zacks Consensus Estimate for Lumentum Holdings' fiscal 2025 revenues and EPS indicates year-over-year growth of 17.8% and 66.3%, respectively. LITE carries a Zacks Rank #2 at present.
FormFactor is set to report fourth-quarter 2024 results on Feb. 5. The consensus mark for EPS has remained unchanged at 29 cents, indicating a year-over-year increase of 45%. The stock has surpassed the Zacks Consensus Estimate for earnings twice in the trailing four quarters, matched on one occasion and missed once, the average surprise being 5.1%
FormFactor's unique capabilities position it for accelerated growth in the advanced probe card market. The company offers a diverse range of probe cards for various applications, including RF, MMW and radar, essential for high-performance wafer testing. Its diversification strategy features a broad lab-to-fab product portfolio across foundry and logic, DRAM, flash probe card and systems segment products. It helps the company stand out from competitors and secure business with key customers.
FORM expects the Advanced Probe Card market to grow to $2.7 billion by 2028, driven by innovation in products like SmartMatrix, Kepler and Pyramid RF probe cards, which meet the increasing demands of advanced technologies like 5G. The company's broad product portfolio and diverse customer base contribute to this growth projection.
The Zacks Consensus Estimate for FormFactor's 2025 revenues and EPS indicates year-over-year growth of 9.6% and 39.9%, respectively. FORM carries a Zacks Rank #2 at present.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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